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Alfa Mutual Insurance Co. v. Meroney6/30/2005
Alfa Mutual Insurance Company ("Alfa") appeals a judgment: (1) denying Alfa's claim seeking a judgment declaring that it is not obligated to indemnify its insured, Willie Merle Morgan, against a $50,000 judgment obtained against her by Mona G. Meroney; and (2) declaring that Alfa is obligated to indemnify Morgan against that judgment. We reverse and remand with instructions.
Shortly after buying a house from Morgan, Meroney discovered that termites had infested the house and had caused significant damage to it before she had bought it. Alleging that Morgan either knew or should have known about the termite infestation and damage before she sold the house to Meroney, Meroney sued Morgan for misrepresentation of a material fact and suppression. Morgan answered Meroney's complaint. Thereafter, Alfa, pursuant to Rules 24(b), 42(b), and 49, Ala. R. Civ. P., and the case of Universal Underwriters Insurance Co. v. East Central Alabama Ford-Mercury, Inc., 574 So. 2d 716 (Ala. 1990), moved the trial court for leave to intervene to seek a judgment declaring that three insurance policies Alfa had issued to Morgan did not obligate Alfa to indemnify Morgan against any judgment entered against Morgan on Meroney's claims. The trial court ordered the parties to file any objections to Alfa's motion within 21 days. When no objections were filed within the 21-day period, the trial court granted Alfa leave to intervene, and Alfa filed its complaint in intervention. Among other things, Alfa alleged that each of its policies contained the following exclusion:
"1. [Liability coverage does] not apply to:
"1. bodily injury or property damage:
(1) which is either expected or intended by an insured ...."
Alfa further alleged that it was not obligated to indemnify Morgan against any judgment obtained by Meroney because the exclusion excluded Meroney's claims from coverage under the policies Alfa had issued to Morgan.
Subsequently, Meroney amended her complaint to add claims against Morgan for negligence, wantonness, and innocent fraud, and Morgan answered Meroney's amended complaint. The case proceeded to trial. Before the case was submitted to the jury, Meroney voluntarily dismissed all of her claims against Morgan except her compensatory-damages claims for negligence, wantonness, and innocent fraud. At the close of the evidence, the trial court submitted Meroney's compensatory-damages claims for negligence, wantonness, and innocent fraud to the jury. On January 14, 2004, the jury returned a general verdict in favor of Meroney and against Morgan and awarded Meroney compensatory damages in the amount of $50,000. Immediately after the jury returned its verdict on Meroney's claims, the trial court, over Meroney's objection, submitted this special interrogatory to the jury on January 14, 2004:
"Was the injury or damage to the Plaintiff Mona G. Meroney either expected or intended by the Defendant Merle Morgan?"
That same day, the jury answered the special interrogatory in the affirmative.
The trial court entered a judgment on the jury verdict in favor of Meroney and against Morgan in the amount of $50,000. Thereafter, Alfa moved the trial court to enter a judgment declaring that Alfa was not obligated to indemnify Morgan against Meroney's judgment. The trial court heard Alfa's motion and, on March 17, 2004, entered a judgment that stated, in pertinent part:
"3. ... [Alfa's] Renewed Motion for Declaratory Judgment Upon Jury Verdict seeking to be relieved of indemnification to Defendant, Merle Morgan, is denied.
"4. ... he court finds that the [special] interrogatory at trial was improper and furt
Page 1 2 3 Alabama Personal Injury Attorneys
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